Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Navitas Semiconductor Q1 2026 Earnings Call. Operator provided instructions to participants. It is now my pleasure to turn the call over to Leanne Sievers. You may begin.

Good afternoon, and welcome to Navitas Semiconductor's First Quarter 2026 Financial Results Conference Call. Joining us today are Navitas President and CEO, Chris Allexandre; and CFO, Tonya Stevens. I'd like to remind our listeners that the results announced today are preliminary as they are subject to the company finalizing its closing procedures and customary quarterly review by the company's independent registered public accounting firm. As such, these results are unaudited and subject to revision until the company files its Form 10-Q for its quarter ended March 31, 2026. In addition, management's prepared remarks contain forward-looking statements, which are subject to risks and uncertainties, and management may make additional forward-looking statements in response to your questions. Therefore, the company claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today, and therefore, we refer you to a more detailed discussion of the risks and uncertainties in the company's filings with the Securities and Exchange Commission, including Forms 10-K and 10-Q. In addition, any projections as to the company's future performance represent management's estimates as of today, May 5, 2026. Navitas assumes no obligation to update these projections in the future as market conditions may or may not change, except to the extent required by applicable law. Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms. Included in the company's press release are definitions and reconciliations of GAAP to non-GAAP items, which provide additional details. For those of you unable to listen to the entire call at this time, a recording will be available via webcast for 90 days in the Investor Relations section of Navitas' website at www.navitassemi.com. Now it's my pleasure to turn over the call to Navitas President and CEO. Chris, please go ahead.

Good afternoon, and welcome to everyone on the call and webcast. We appreciate you joining us on today's call. I'm pleased to report that Q1 is reflecting another quarter of solid progress and growing momentum on our transformation to Navitas 2.0, highlighted by the company's return to top line sequential growth. For those of you that may be new or still coming up to speed on our story, I want to begin with a brief high-level summary of our ongoing strategic transformation and Navitas 2.0 vision. Over the past two quarters, we have meaningfully reaccelerated our pivot away from the company's historical mobile and low-end consumer business to focus the entire organization on high-power markets, where Navitas GaN and high-voltage SiC products can deliver long-term differentiation and value. Today, we are singularly focused on four high-growth, high-value market segments: AI data center, energy and grid infrastructure, performance computing and industrial electrification. Our go-forward objectives are to rapidly achieve scale in these higher-value markets in support of driving sustainable and profitable growth. Turning to an overview of the quarter. Our Q1 financial results demonstrated solid quarter-over-quarter improvement, and we observed growing momentum across our high-power markets and expanded customer engagement. Highlighting the quarter, we achieved the expected return to growth in Q1 with revenue increasing 18% sequentially. The renewed growth was driven by our high-power markets, which also represented a growing and larger majority of total revenue as we continue to reduce reliance on the company's historical mobile and consumer business. Although far too early to declare victory, we effectively completed our realignment of the entire organization, and Navitas is back to growth, driven by our high-power markets. In fact, revenue from our high-power business grew 25% year-over-year with all four of our high-power end markets increasing sequentially in Q1. The increased contribution from high-power markets also drove a favorable mix in our overall revenue mix, resulting in improved Q1 gross margin. Consistent with our previously communicated expectation, we anticipate continued sequential top line growth and gradual gross margin expansion throughout '26. The ultimate success of our strategic transformation continues to be grounded in four pillars: market focus, technology leadership, operational efficiency and financial discipline. With respect to market focus, we continue to see new technology adoption accelerating across multiple end markets and customers, both of which are increasingly driving towards GaN and high-voltage SiC solutions. Without question, AI is the primary catalyst driving this momentum and leading to the broadening adoption of high-power solutions across all four of our target end markets. Collectively, this market represents a serviceable addressable market of $3.5 billion by 2030, split roughly 50-50 between GaN and high-voltage SiC with combined CAGR exceeding 60%. We are definitely focused on the largest portion of the TAM, which I'd like to refer to as the AI infrastructure comprised of unique but related growth opportunity across the AI data center and the grid and energy infrastructure, each of which are fundamental to enabling the AI evolution. Today, the aggressive increase in compute power density is accelerating GaN and SiC adoption in data centers, while the required modernization of the energy grid and green infrastructure to support these data centers is driving increased need for high-voltage SiC. Navitas is uniquely positioned as one of the very few companies that can claim deep long-term experience in both GaN and high-voltage SiC technologies. We're also agnostic and readily offer customers the ability to choose the optimal solution for their application architecture. As a result of our proven capability in both SiC and GaN, we believe it allows us to address more of the power chain and ultimately capture more content per system. Briefly providing the trends and opportunities specific to each of our four targeted end markets, starting with AI data centers. As a technology leader in both GaN and SiC power delivery, we support all major AI data center architectures with industry-leading power density and efficiency. Again, having both technologies is a strategic differentiator and our ability to fully support a given customer's chosen approach translates into more opportunities across more applications and greater potential total content for Navitas. As conveyed at the recent NVIDIA GTC event in March, AI data center is rapidly evolving towards HVDC architectures, leading to expanding content opportunity driven by the need for exponential power levels, increased density and top-tier efficiency. Our immediate focus remains on expanding sampling of our newest GaN and SiC products, enabling qualifications, preparing for scale ramp and supporting hyperscalers and OEM customers in their ongoing design and development efforts, spanning from AC-DC PSUs and DC-DC PSUs to affordable HVDC brick designs at higher power level capacity. In grid infrastructure, we continue to advance active engagement across a series of new and existing customers with notable acceleration in design activity in the United States. AI remains a prominent underlying catalyst as all industry participants increasingly acknowledge the existing energy grid is not capable of supporting the projected future rollout of AI deployment. This market, where technology and scale are equally important, represents a large and long-term secular growth opportunity for our current and future high-voltage SiC products. Navitas' GeneSiC technology positions us as a leading enabler of the grid and energy infrastructure modernization efforts, providing customers with more reliable and higher density power through our recently introduced 2.3 kV and 3.3 kV modules and a roadmap to even higher voltage. In performance computing, we are seeing sustained healthy adoption of GaN in higher power charger solutions for high-end laptops and mobile workstations used for gaming and AI development. Our opportunity in this market continues to be driven by the dramatic increase in power requirements with CPUs moving from 15 to 30 watts to 45 to 80 watts in ultra-end AI notebooks, with the integration of GPUs requiring up to 120 and 175 watts. As a result, we expect to benefit from growing demand and momentum in performance computing market applications throughout '26 and beyond. Finally, in industrial electrification, we are continuing to see customer traction in both GaN and ultra-high voltage SiC in high-performance applications such as DC-DC converters and megawatt chargers, industrial pump, motor control and heavy equipment electrification. With respect to our second pillar, technology leadership, we remain fully committed to ongoing innovation in GaN and high-voltage SiC driven by focused R&D investments and demonstrated by expanding customer engagement and co-development projects. On GaN, we have continued to accelerate sampling of our 100-volt and 650-volt devices to more OEMs and ODMs. Customers pursuing the 800-volt HVDC architecture today are testing GaN, and we believe most are doing testing with magnetics devices. We are focused on enabling and supporting customers in this transition from silicon to GaN like we have always successfully done in our past. More recently, we have seen some customer internal system-level testing on our newest GaN devices. During the first quarter, we continue to deepen our collaboration with OEMs, ODMs and hyperscalers, including demonstration of enabling new GaN architectures that feature high power efficiency and reliability, which is leveraging Navitas' more than 10 years of GaN experience and expertise. One of those highlights was our recent release of a 20-kilowatt 800-volt to 6-volt DC-DC platform using our latest 8x8 60-volt GaNFast device aiming at 97.5% efficiency. This platform solution was formally unveiled in March at GTC and showcased at NVIDIA MGX. As a reminder, we also previously released an industry-leading 800-volt to 50-volt AI DC-DC power fully GaN, 60-volt and 100-volt, delivering best-in-class efficiency and density. These respective platforms are generating strong interest and prospective customer engagement due to their demonstrated ability to deliver the highest power density, efficiency and performance for next-generation AI data center architecture. Today, our team remain focused on execution, including product delivery, qualification and preparation targeting growth for GaN-based 800-volt HVDC architecture in 2027. On high-voltage SiC, we continue to strengthen our technology with a focus on high power density and capability, which represent both the primary market drivers and our key differentiators in terms of silicon and packaging. Following the introduction earlier this year of our new industry-leading Gen 5 GeneSiC technology based on our patented trench-assisted planar architecture, in March we released our 1.2 kV Gen 5 SiC product tailored in packages to address higher power density DC-DC and AC-DC units in PSU applications. We have since delivered samples to OEMs and ODMs, and they are currently being evaluated by most PSU vendors. Initial customer feedback has been excellent with reports of up to 50% increase in power density and greater than 98% system efficiency and improved cooling. Turning to operational efficiency. The prior restructuring action initiated late last year, which I discussed in detail last quarter, has been substantially completed. As previously mentioned, today, the entire organization and its resources are fully aligned to focus on the high-power market. This represents a substantial strategic repositioning from where the company was just nine months ago. Our team is moving fast and working very hard and their collective mitigation is impressive. Recognizing the tremendous opportunities ahead, we plan to continue adding selective engineering skills and competencies to accelerate customer support over the coming quarters. Also during the quarter, we completed our leadership transformation with the appointment of our new CFO, Tonya Stevens, who formally joined the team in late March. We now have the full leadership team in place, including new leaders in operations, engineering execution, sales and marketing, business units and finance, all of whom joined the company in recent weeks and months from larger companies with strong track records in execution and scale. Importantly, this newly appointed team and our employees have demonstrated strong buy-in and excitement for Navitas 2.0, and it's a privilege to lead this transformation alongside each other. We also continue to make progress on our strategic technology and foundry partnership with GlobalFoundries for non-GaN. We are confident this will enable our planned 8-inch pivot in 2027 for GaN manufacturing in the United States. At the same time, we are starting to build appropriate buffers with TSMC to ensure a smooth transition for all existing customers. Additionally, we have begun actively scaling our supply chain to support upcoming growth and demand, and we are leveraging AI internally across design and most functions to allow us to scale even faster. Our fourth pillar is financial discipline, which we are committed to as we execute our scale-up plan and transformation to Navitas 2.0, a consistently growing and profitable high-power company. This includes remaining diligent with respect to prioritizing our investment in high-power programs, maintaining leverage in OpEx and focusing on high-margin, long-term engagements that build multinational customer relationships. We made significant progress in Q1 with our previous restructuring effort and the full move towards high power market is now substantially complete. Going forward, we'll continue to drive efficiency across the organization and are committed to disciplined investments in the business, even as we target a much larger market opportunity. Our focus remains on top line growth and margin expansion, driven by improving scale and mix of our high-power business in support of achieving long-term profitability. In summary, I am very pleased with the continuous progress and great momentum we have achieved in such a short period of time. We're taking further steps towards positioning Navitas as a high-power company. We anticipate continued sequential revenue growth in the second quarter and throughout the rest of '26. Q1 was the first clear proof point and the growth in high-power markets demonstrate the momentum of our Navitas 2.0 strategy. We also anticipate gross margin to steadily improve as volume growth drives better fixed cost absorption and our revenue mix increasingly favors the high-power business. Mobile contribution will continue to diminish this quarter and become insignificant by year-end. At that time, we expect our business and revenue will be defined almost entirely by high-power markets, a transformation that positions us well for sustainable long-term growth and profitability. Before I turn the call over to review our financials, I'd like to take this moment to welcome Tonya Stevens, our newly appointed CFO. I'm thrilled to have her join our executive team. She brings over 30 years of exceptional track record of financial leadership in the semiconductor industry, most recently at Lattice Semiconductor. I look forward to her valuable contribution as we grow the business and scale our operations to a larger, financially disciplined and profitable company. With that, I'll pass the call to Tonya to introduce herself and review our first quarter financials and second quarter outlook.

Thank you, Chris. Before reviewing the financials, I would like to take a moment to introduce myself and share my motivations for joining Navitas. My corporate finance career spans more than 30 years and began with seven years in public accounting. I've since spent the majority of my career in the semiconductor industry, including 17 years at Intel in Corporate Finance and the last seven years at Lattice Semiconductor as Chief Accounting Officer and previously Interim CFO. I'm incredibly excited to join Navitas for several reasons. The team is comprised of extremely talented and capable leaders and individuals who are laser-focused on executing the company's strategic objectives in a rapidly advancing and high-velocity environment. Together with its compelling technology portfolio, the company represents a pure-play GaN and SiC opportunity to scale up and capitalize on the substantial AI-driven secular growth in high-power markets. It's a privilege to be part of the Navitas leadership team, and I look forward to meeting many of you that I haven't met already over the coming weeks and months. With that said, I will now review the financial results for the first quarter of 2026 and then discuss our outlook for the second quarter. Please note, unless otherwise indicated, I will focus my comments on non-GAAP results. A detailed reconciliation of all non-GAAP to GAAP financial measures can be found in our press release published earlier today. Revenue in the first quarter of 2026 exceeded the high end of guidance, increasing 18% sequentially to $8.6 million on a GAAP basis. This compares to revenue of $7.3 million in the fourth quarter and $14.0 million in the first quarter of 2025. As Chris highlighted, the return to sequential growth was driven by high-power markets, which grew approximately 35% from the first quarter 2025 and now represents a large majority of total revenue as the company continues to reduce its reliance on historical revenue contribution from mobile and low-end consumer business. Notably, we expect high-power markets to continue driving sequential growth throughout 2026. The higher quarterly revenue and improved revenue mix drove a 30 basis point expansion in gross margin, which improved to 39.0% from 38.7% in the prior quarter and 38.1% in the first quarter of 2025. The shifting mix of total revenue toward higher value, high-power markets and away from mobile and low-end consumer is key to our gross margin expansion strategy. We expect sustained gradual improvements in gross margin throughout the coming year. Operating expenses for the first quarter were $15.0 million compared to $14.9 million in the prior quarter and $17.2 million in the same quarter a year ago. Operating expenses for the quarter reflect our commitment to focused and disciplined spending, particularly in SG&A, which created the opportunity to invest more in R&D projects quarter-over-quarter in support of our strategic pivot to Navitas 2.0 while keeping total operating expenses flat. Loss from operations for the first quarter was $11.7 million compared to a loss of $12.1 million in the prior quarter and $11.8 million in the first quarter of 2025. In Q1, diluted shares outstanding was approximately $230 million, resulting in Q1 loss per share of $0.04 compared to $0.05 loss in the prior quarter. Turning to the balance sheet. Cash and cash equivalents at the end of the first quarter 2026 were $221 million compared to $237 million at the end of the fourth quarter, and the company continues to have no outstanding debt. With respect to inventory, we ended the first quarter with $14.9 million compared to $13.3 million at year-end. The sequential increase in inventory primarily reflects our measured investment to support future anticipated revenue growth. With respect to channel and distributor inventory, as a result of previous streamlining actions taken during the latter part of last year, we now have a significantly healthier channel inventory profile. Going forward, we are committed to disciplined monitoring and management of these inventories to ensure we are well positioned to respond quickly to end market demand. Overall, the balance sheet remains very strong and provides the company with an extensive amount of liquidity as well as ample flexibility in terms of working capital to execute our strategic objectives and anticipated growth. Moving to guidance for the second quarter of 2026. Consistent with the company's previous communications, we expect continued sequential growth with revenue increasing to $10.0 million, plus or minus $0.5 million. At the midpoint, this represents over 16% sequential growth compared to the first quarter of 2026. Non-GAAP gross margin is expected to be 39.25%, plus or minus 75 basis points, which at the midpoint represents a 25 basis point increase, primarily reflecting the ongoing shift in revenue mix toward higher power markets. Non-GAAP operating expenses are expected to remain approximately flat sequentially between $14.5 million to $15.5 million as we continue to emphasize disciplined cost management. Moving forward, we may choose to selectively invest in OpEx to accelerate growth at a fraction of the rate of revenue growth. That concludes our formal remarks. Operator, please open the call for questions.

Operator provided instructions to participants. Our first question comes from the line of Tristan Gerra with Baird.

I know it's still probably a bit early, but would you be able to talk about the dollar content that we could expect per rack for silicon carbide on the first-generation 800-volt architecture? Then what type of ramp in content should we expect with Kyber for both silicon carbide and GaN?

Tristan, this is Chris. Thanks for the question. If you refer to our prior communication, we gave guidance in terms of content per megawatt because that's the best way to define the content. We talked about GaN in the range of $10,000 to $15,000 per megawatt, really driven by the massive 800-volt HVDC when the DC-DC gets inside the rack, as we discussed primarily. In the AC-DC PSU, there is about $5,000 to $8,000 per megawatt, which is coming from both the higher power of those PSUs. If you refer to GTC, NVIDIA announced that at the end of the year, the PSUs, the AC-DCs are going to get to 18.5 kilowatts, which is a much higher factor if we look at the power level from today's PSUs, the AC-DCs, which are in the range of 5 to 10 kilowatts to 18.5 kilowatt for NVIDIA, but even 25 to 30 for other hyperscalers. There's a ratio — when power goes up by two, the SiC content goes up by five. There is a non-linear increase. I'm not going to get specific in terms of content because it really depends on the architecture, single-phase, three-phase and so on, but refer to the $5,000 to $8,000 of content for the SiC inside the center, which is mostly AC-DC PSUs and the mental model, which I just mentioned, which is when the AC-DC goes from, let's say, 5 to 10 kilowatts to 18 to 25 to 30 kilowatts, there's about 2.5x content acceleration compared to per rack.

Then for my follow-up, specific to silicon carbide, clearly, pricing has been coming down drastically in '24 and '25. Given the ramp that you see, do you expect pricing to stabilize? I know you're going to be in the very high voltage. How different is that pricing dynamic there than in the lower voltage, but also do you expect at some point supply-demand balance in silicon carbide?

We don't participate, as you know, in the low-voltage SiC business, which is mostly industrial and EV. What we see is for inside data center, the AC-DC mostly use 1.2 kV and above, sometimes 1.2 kV and above, where the driver today is more speed, reliability and density. Of course, this is a competitive market, and as the hyperscalers are driving more power and more PSUs and more PSUs per rack, it is quite competitive. Today, what we see is that customers are pushing us on how we execute and how we help them to get to the best scalability and the best density of power, which I think saves a lot more money at the system level than a cheaper device.

Operator provided instructions to participants. Our next question comes from the line of Madison DePaola with Rosenblatt Securities.

This is Maddie calling on behalf of Kevin Cassidy. You highlighted that GaN and SiC are both playing vital roles in AI power and that you guys are uniquely positioned to win both technologies. I know you mentioned this, but can you provide any more color on how having both capabilities is helping in customer discussions or design win activity in data center over your larger competitors?

Maddie, this is Chris. First of all, I think we focus on the high-power markets, right? We have four markets. Each of them have a different flavor of architecture and technology. If I refer to AI data center, it's mostly a GaN and SiC play. If I look at grid infrastructure, it's mostly a SiC play. Of course, high-performance computing is more GaN play and industrial is actually both a SiC and GaN play. If you look at the first two, which is what your question is, if you look at the evolution of the architecture, let's zoom out a little bit. Today, in the current architecture, the traditional architecture is a 50-volt bus bar where the voltage from the grid, which is 480-volt AC, converts to 50-volt DC. That's mostly using SiC. The first step, and I think I referred to what has been announced at GTC, is the introduction of 800-volt, the introduction of three-phase much higher power, which I referred to in my answer to Tristan. The first phase is mostly higher power three-phase AC-DC, where you convert the 400-volt or 480-volt AC into 800-volt DC. That's the first phase that's going to start at the end of the year, early next year. On the AC-DC we use mostly SiC. Now there is a DC-DC conversion to that. If you refer to what NVIDIA announced at GTC, there is a DC-DC top-of-rack converter at 15 kilowatt for instance, that can use either GaN or SiC. I think both are already enabling customers to have a choice depending on the preference. What is very interesting is when you move to the next step, which is the second phase of the 800-volt DC architecture, where you get to high-density racks — megawatt racks such as Kyber for NVIDIA or other high-density racks for the large hyperscalers — that's where you move the DC-DC conversion inside the rack. When you do that, you have no choice than to use GaN because the level of density and switching frequency requirements make it impossible to use silicon, and silicon carbide doesn't have the switching frequency for those use cases. That's where you're moving to GaN. The key point is there's a continuum of architecture change and evolution, and having both technologies allows us to support customers across multiple phases of that evolution.

Operator provided instructions to participants. Our next question comes from the line of Quinn Bolton with Needham & Company.

This is Shadi Mitwalli on for Quinn. My first question is for Chris, but do you have any big picture takeaways from GTC in APAC in March, especially in regard to the direction of GaN versus SiC in 800-volt data centers?

My takeaway was kind of what I just mentioned to Maddie. First of all, we've talked about 800-volt architecture now for more than a year. It's happening. I think NVIDIA was very clear that they see, at the end of the year, early next year, what I call the first phase of the 800-volt HVDC architecture where you basically do the AC-DC at a much higher level of power with SiC and then you do a DC-DC where you can use GaN and SiC. Outlining that as you move to the next step, the move to much higher density racks is kind of enabling GaN content to move next. That's my takeaway from GTC: 800 volt is happening. Now keep in mind that there are other hyperscalers. They might have a different path; they might actually go even faster to the next phase where you get the DC-DC part inside the rack, which will accelerate GaN adoption. I would say I come out of GTC with a stronger conviction that having both makes a huge difference. I think it's actually very hard for a supplier to sit at the big table if you either only have GaN or only have SiC. There are only a handful of suppliers who have both. That's the key differentiation. That's my takeaway on top of the fact that industry momentum is accelerating.

Then my follow-up is just on the product landscape for GaN. As you're sampling with hyperscalers, what are some of the key specs that matter most to them when evaluating GaN products? How does your portfolio measure up against those requirements?

What we said before is we've sampled both high voltage, so 650-volt GaN as well as mid-voltage GaN 100-volt. We've done that in different flavors of package, depending on the level of integration and density that the customers are looking for. In the last quarter, we mentioned we've done the initial samples; since then, we've now delivered the final samples, which are basically the samples that will go to production. We are working with customers as they move from device level testing to board and system level testing. The feedback we get is our technology as well as packaging offering is actually adequate to what they're trying to do.

Operator provided instructions to participants. Our next question comes from the line of Richard Shannon with Craig-Hallum Capital Group.

This is Tyler Anderson on for Richard. I was just wondering, could you talk about why customers would want to upgrade transformers that aren't connecting to data centers? Have you heard of any talks within the government to force the upgrade of transformers?

I'll start by the last part of your question. We have no knowledge of any forcing function or requirement for the government to move from traditional transformers to solid-state transformers (SSTs). What I would tell you is if you look at transformers today, they are operating at a low frequency, which is 60 Hz. They have limited efficiency, which is less than 95%. They are heavy and very large. As you move to an explosion — that's what we're talking about — an explosion of rollout of AI data centers, which basically pull on the grid a lot more energy, you have to install a lot more transformers. That's going to be, at some point, impossible if we keep the conventional transformer. The move to SST is a bit of a necessity as we scale up and deploy the hundreds of gigawatts in the next few years. The other thing I would refer to is we keep referring to SST, but when we talk about grid and energy, this goes beyond SST. SST is going to be one step in the evolution. Today, you have much higher level power converters, megawatt converters. You have grid-scale solar farms that are being deployed. There's a lot of grid-type applications that are being deployed, which we see as a growing driver even in '26 and '27 ahead of the big acceleration of the SST, which we expect to come in late '27 and early '28.

I'm also wondering if there's anything around switching. I'm seeing something about aluminum conductor steel-core transformers, and I'm wondering if you would be able to benefit from upgrades in switching?

Yes, you would. I think the grid companies have realized that the only way to make the grid compatible with the acceleration of power is really to get to this new form of conversion with fewer steps — moving to higher-voltage DC and more flexible AC-DC conversion. I think this will require new types of power electronics and isolation transformers. That creates an opportunity for high-voltage SiC solutions and advanced power conversion technologies.

Then have you heard of any conversations around the lack of supply of transformers accelerating anything with your customers?

I have not heard that specifically, but I would not be surprised that requirements for volume in terms of classic transformers and the dependency on materials might actually accelerate modernization of the grid. Supply chain constraints for traditional transformers could be another factor pushing customers to consider newer, more scalable power conversion technologies over time.

Operator provided instructions to participants. Our next question comes from the line of John Tanwanteng with CJS Securities.

This is Jeremy on for John. Can you just talk a little bit more about the sequential improvement you're seeing heading into Q2, if that's mostly data center driven and if you're meaningfully ahead of where you thought you were going to be a quarter or two ago?

Yes. I'll start and let Chris add. Relative to your point on high-power markets, if you remember in Q4, we talked about high power being the majority for the first time in the company's history, and we talked about it being greater than 50%, with mobile being less than 25%. In Q1, high power continued to grow and was a large majority of the company, as you heard us say. Throughout the year, we expect it to continue to grow as a percent of the company. We exit the year almost an entirely high-power company and that is being driven by data center and grid infrastructure — the AI infrastructure component of that. You saw in our press release and our discussions, high-power grew 35% year-over-year from Q1 of '25 to Q1 of '26, and we expect that growth to accelerate in the second half of '26. Again, driven by both components, but the key catalyst is that AI component. The momentum is driven by all of the high-power markets, but particularly the AI infrastructure, and that's data center and energy grid.

I will add to that, Jeremy. First of all, if you look at Q4 to Q1, when we grew 18%, the high-power markets grew as a percentage of the company. That means that the growth of high power was actually much higher than 18% top line for the company and grew 35% year-over-year. We don't break down by market in detail, but we did say that all markets grew sequentially. What I will give you is one data point: the AI infrastructure — the combination of data center and grid — grew 50% quarter-over-quarter from Q4 to Q1. That's the only color I'm going to give you. As the company grew 18% quarter-over-quarter, the combination of data center and grid infrastructure grew 50%. That's stronger than expected. The reason it's stronger is we see an acceleration of rollout. We have not yet seen the content step-up. I talked earlier about content going up when, for example, you move from a 10-kilowatt PSU to an 18.5- or 25- to 30-kilowatt PSU; the content scales non-linearly. Today, what we are seeing is growth driven by AI adoption. Next year, we'll see acceleration of GaN as the DC-DC gets inside the rack. I think what we are seeing here with the 50% number is that AI data center adoption is accelerating. I will also tell you that even though we don't guide by market, what we see today for Q2 — and as a reminder, we are confident in our guidance for Q2 — the AI infrastructure that grew 50% quarter-over-quarter is actually going to grow faster, and that growth is likely to accelerate throughout the year. That's before even the step-up in content.

One last follow-up. Any update on the use of cash this year and next in support of the growth ramp? What are your thoughts on when cash flow breakeven is likely to occur?

Coming into Navitas and being new, when you look at the strength of our balance sheet — and I referenced that earlier — it's a very strong balance sheet. We have over $221 million in cash and no debt at the company. That gives us a pretty long runway to support our working capital needs and CapEx flexibility. I'm confident we can execute the objectives and the organic plan consistent with what I said in my script. Again, we remain focused on profitability. Like Chris said, we remain on track and maybe a little ahead of where we thought we would be to profitability. We're very focused on that. Nothing's changed in our thoughts around profitability and in fact, it could potentially be accelerated a bit.

Jeremy, you can make the math. At today's gross margin and today's OpEx, it will take us to be in the high 30s from a revenue standpoint to be profitable. We're guiding double-digit sequential growth in Q2 and expect that growth to continue throughout the year. There is no reason to believe based on what we just discussed that the momentum we are seeing in data center and grid infrastructure as well as the other high-power markets will slow down. I won't provide a specific date for breakeven, but reaching breakeven is a key objective for us. We're going to spend what we need to invest to optimize and drive our growth, while being financially efficient to get to breakeven as a priority.

Operator provided instructions to participants. Our next question comes from the line of Quinn Bolton with Needham & Company.

Welcome Tonya. Great to have you on board. I wanted to follow up, Chris, you mentioned that at least on the 800-volt GaN opportunity, you've kind of moved from device level testing to board level testing. Can you walk us through what the following steps would be to get to final production and sort of the timeline if these higher power racks go to production, say, second half of calendar 2027? When do you think those designs would be fully locked down? Will that happen at the end of this year or could that continue into 2027 in terms of the testing process?

Thank you, Quinn. Nothing has changed fundamentally. The timeline differs depending on whether you're looking at the first phase or the second phase of 800-volt adoption. For the first phase, which is the AC-DC PSUs and top-of-rack DC-DC units, those are designed and implemented by merchant power OEMs and ODMs such as Delta, Flex, Vertiv and others. We have delivered samples, both the 1.2 kV SiC Gen 5 in the new package as well as our GaN devices, and we have delivered final samples which are aimed at production. For those boards, customers have moved from component level testing to board and system level testing. The feedback and optimization work is ongoing, and they are doing system validation steps. For the first phase, which is expected to begin ramping at the end of this year and into early next year, we will get clarity quickly as customers complete their qualification cycles. When it comes to the second phase — in-rack DC-DC conversion driven by hyperscalers, which is predominantly GaN — that is hyperscaler-led and hyperscaler-driven. We expect to see proof points for in-rack GaN-based DC-DC in Q1 to Q2 next year. I would characterize the progression by the increase in the number of samples and the level of engagement. When you move from tens of samples to hundreds and thousands, that's when you see the conversion to production. We're seeing that engagement increase and that's why we're confident in the momentum. We won't comment on specific pipelines or customer engagements unless customers choose to go public, but you should expect to see the proof points in backlog and continued topline growth.

I guess a follow-up just longer term: do you guys have a view? Are you seeing customers push the intermediate bus voltage to 48, 12 or 6 in that 800 to step down? Do you think that 800 to 6 ultimately wins? Or do you think there's going to be a mix of different intermediate bus voltages across different hyperscaler platforms?

In the first phase, the intermediate bus remains around 48 or 50 volts. For the true in-rack 800-volt HVDC architectures, different hyperscalers will choose different intermediate voltages and system approaches. Some may choose 12 or 6 volts in a more aggressive in-rack conversion, others may retain a 50-volt bus but move the DC-DC conversion inside the rack. So I expect multiple flavors and choices across hyperscalers. The directional trend, however, is fewer conversion stages as you move to higher density racks, and that tends to drive secondary voltages down over time.

With that, I will now turn the call back over to Chris Allexandre for closing remarks.

Yes. Thank you for joining us today. As I said earlier, it's too early to declare victory, but the company is on track and accelerating the pivot and the transformation to Navitas 2.0. We have a lot of work still ahead of us. If you look at our momentum in high power, the growth in high power, the growth in AI infrastructure which I mentioned quarter-over-quarter and the trend that we have ahead of us, I'm confident this will continue. I want to close by thanking our Navitas team for a lot of work. This was a big pivot that we asked the team to go through, moving from historical consumer low-end mobile type of business to high power. It's a big shift in terms of geographical coverage and in terms of product mix. I want to thank them for the effort, the resilience and the work that we are putting into making that happen. Of course, our customers that are supporting us as well. Thank you.

Thank you again for joining us today. This does conclude today's conference call. You may now disconnect.